Monday, 29 September 2008

Credit Crunch

Is it me or has the world (or the West) gone crazy. I am so mad about what is going on in the financial markets at the mo, for my own sanity i had to vent.

I have been saying for the past couple of years that the markets were unstable and a crash was highly possible if not inevitable. Crazy bankers and greedy brokers have been building a house of cards. Lending way more than was sensible, for flip flops sake, surely the very label "sub-prime" was enough of a clue!! And now it has all gone belly up, after years of indifference at best and down right hostility at worst to government regulation, they all go crying to the state to help them out.

And - this is the bit that really makes me mad - the state says ok. We will lend (a city euphemism for give) you billions of quid, so long as you promise to say sorry and try not to do it again.

Lehmans US kept $1.9 billion to share out to executives which would have paid all the UK staff for a year. As it is, they get no redundancy pay or even the wage they just worked for.

So obviously we can trust these same people to use the $700 billion US government hand out wisely and fairly and for the benefit of the whole of society and not just stuff it in their own pockets.

Taking this slightly wider - what it shows us is that Free Market Capitalism can only ever result in disaster. In every de-regulated sector, what happens is not an increase in competition driving down price, but rather a serious of mergers that results in several large companies exercising monopoly power and ripping of the customer.

The top people in these firms make lots of money - and the majority of us end up paying more and more for our electricity, petrol, food etc etc

What we need is an end to greed and the idea that profit is all that matters. We need people to matter again. Community to matter again. If that comes as a result of this crash, then it will be a defining moment in history.

My fear is that nothing has been learnt and the the banks will just take the cash, our cash, and start building the same house of cards again, and in a year or so, everything will be fine once more - for them!

2 comments:

A useful biblical perspective on all this can be found in the book of Revelation, where John offers his first century Roman readers a social/political/economic critique of the empire under which they were living.John invites those in the churches he is writing to, to realise that Rome is not all it's cracked up to be, and he asks them to see through the glittering propoganda of empire, and to realise that it's actually a violent and oppressive beast, a corrupt and corrupting whore.John then depicts in vivid language the destruction of this empire which has grown rich and fat by devouring the nations of the world for its own gain. The empire is portrayed as an ultimately self-destructive system, which consumes and consumes to the point where it consumes itself through its own greed and corruption.John then offers those in his churches a choice: Are they going to mourn the passing of the empire, weeping and wailing as its systems collapse around them, or are they going to see its passing as the enacted judgment of God?John's theological perspective is clear - he says the people of God should rejoice as the empire falls. Not rejoicing at the personal hurt which the empire inflicts on those it takes with it as it tumbles, but rather rejoicing that the oppressive and destructive system which appeared so eternal is actually passing into history.The next question which John offers his readers is that of what they will construct next? Will they allow the world to reinvent Rome (or Babylon, or Communism, or Global Capitalism, or whatever)? Or will they offer to the world and alternative way of being human?The vision of the New Jerusalem represents God's alternative city come to the earth through the church. It is a city which runs on godly rather than satanic economics, it is a city which is good news to all nations, good news to creation. It is the 'kingdom come, on earth as in heaven', to quote Jesus.So - as the modern Rome totters, as its conspicuous consumption turns inwards in judgment, John's question to the church remains the same: How will we respond? What will we build?

Absolutely. So rather than rescue what is effectively a broken system - or rather rescue Wall Street - does the system need to break completely and then be rebuilt with new rules. Ann Pettifore has some interesting thoughts on what that might look like.